Closely Held Businesses

Final Examination (Take-Home) -- Spring, 1993

(Professor Kleinberger)



Available: 5 PM, Monday, April 26, 1993 (Central Services)

Due: 5 PM, Friday, May 14, 1993 (Student Services)

Page Limit: Twelve Pages

Instructions

This is a take-home exercise. It is due in Student Services at 5 PM on Friday, May 14, 1993. You may submit your answer early, at any time during which the Student Services office is open. Late submissions are subject to being downgraded. You need not turn in this document. Keep a copy of your answer.

Your answer must be typed, double-spaced and may not exceed twelve pages. Use reasonable margins and do not use unusually small type sizes. If you have any questions about the reasonableness of your margins or the size of your type, contact Professor Kleinberger well in advance of the deadline. [(o) 290-6387; (h) 681-0018)]

This is an individual, solitary exercise. Once you have picked up this document or have any knowledge of its contents, you may not discuss the exercise with anyone except Professor Kleinberger. If you have any questions about the examination, contact Professor Kleinberger well in advance of the deadline.

This is a limited open book examination. You may use only the following materials ("Permitted Materials"):

the assigned photocopied materials, any additional photocopied materials distributed by the professor during the semester and any notes you have personally made or developed in studying for the course or this examination, and

outlines or other notes developed by a group of students enrolled in this course this semester if (a) the group outline or other notes were developed before any participant in the group picked up this document or had any knowledge of its contents, and (b) you played a substantial role in the development of the group outline or notes.

Once you have picked up this document or have any knowledge of its contents, you may not do any research beyond the Permitted Materials. Except for Permitted Materials, you may not use treatises, hornbooks, commercial outlines, other commercial works or any other materials prepared by others.

Please keep in mind that "spotting issues" is only the first step in doing a legal analysis. You must also take the issues you identify and organize them into a coherent structure. Then, within that structure, you must examine those issues (by applying the law you see as relevant to the facts you see as relevant) and argue for some conclusion.

Please do not write about subjects that are not germane to your analysis. Writing a "treatise" on some area of law that the question does not put in issue wastes your time and conveys the unfortunate impression that you do not understand which issues are relevant.

If you rely on particular cases as authority, cite them. Do not, however, use case names as a substitute for stating the law. Do not use "blue book" form. Instead, state the name of the case (or a shortened version that nonetheless identifies the case) and the page number(s) from the photocopied materials.

If you rely on a statute, you must cite that statute. If you are relying on a subdivision or a paragraph, your cite should include that subdivision or paragraph. Do not worry, however, about "blue book" form. For example, for the purposes of this examination "Minn. 302A.565, subd. 1" and "Del. 144(e)" are both in adequate form.

The grading rewards coherence. It will probably be worth your while to take some time to think about the organization of your answer before you begin writing. Ask yourself:

whether you have identified all the necessary parts to your analysis;

whether all the issues you have identified are actually necessary; and

whether you have organized your issues in a way that is likely to make sense to your reader.

The Substance

This Examination consists of Problem #12, from Topic Twelve of the Photocopied Materials, with an additional issue (stated below). Problem #12 appears on pages P-24 and P-25 of the Photocopied Materials.

You should of course read the materials in Topic Twelve. You may also wish to consider other materials we have studied during the semester.

In analyzing Problem #12, assume that:

all the corporations referred to are Minnesota corporations;

prior to the cash out merger, Automatic Recog, Inc. (the surviving corporation) owned no shares of Patrec, Inc.;

both the corporations and the dissenting shareholders have complied with all the procedural requirements of the Minnesota statutes on dissenters rights;(1)

in the absence of controlling Minnesota precedent, Minnesota courts will seriously consider any relevant non-Minnesota cases included in the Photocopied Materials.

Add the following issue to the list at the end of Problem #12 (page P-25 of the Photocopied Materials):

1a. whether the appraisal value should be diminished by a minority shareholder discount, a "key person" discount, both, or neither,















Good luck.

1. These statutes are included in the sections of Minnesota corporate law provided at the beginning of the Photocopied Materials.